RBI to set up more offices in northeast

Agartala, Nov 6 (IANS) The country’s central bank, Reserve Bank of India (RBI), will set up more offices in northeastern states to better monitor the nationalised and regional rural banks in the region, a minister said here Saturday.

“RBI has decided to open its sub-offices in six northeastern states - Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura and Meghalaya - in a phased manner,” Tripura Finance and Public Works Development Minister Badal Choudhury told reporters, quoting RBI notifications.

According to the minister, the decision was taken at the RBI’s recent second quarter review of monetary policy for 2010-11 held in Mumbai.

“After the opening of RBI offices in northeast region, the monitoring and functioning of the nationalised, regional rural banks and private banks in the region by the central bank would be further improved,” Choudhury said.

“We have been demanding for more RBI offices in the region for the past 12 years to improve the credit deposit ratio, providing advances and financial support to the people of the region,” the minister added.

He complained that the credit flow to the northeastern region from nationalised banks was very low.

“It is unfortunate that despite intervention from the union finance ministry, the credit-deposit ratio for the commercial banks in the region has remained at a level of around 30 percent over the past many years. This should be raised to at least 50 percent by 2010-11,” Chowdhury said.

At present, the RBI has a regional office in Assam’s major city Guwahati.

The minister urged the nationalised banks to open more branches in rural areas to curb the illegal collection of deposits by the non-banking financial companies (NBFC).

Quoting RBI guidelines, Choudhury said the central bank had asked all the nationalised banks to open banking services, in any form, to every village in the country with a population of over 2,000.